Westpac has reported a $6.8 billion profit and forecast a 10.9 per cent drop in house prices by March 2027.
Westpac reported a $6.8 billion profit on Monday, ahead of the Reserve Bank of Australia's next interest rate decision on Tuesday. Its profit for the year to September was down 1 per cent from the previous year, and it will pay a final dividend of 77 cents a share, taking the full-year dividend to $1.54, up 1 per cent from the previous year.
The Reserve Bank is widely expected to raise rates for the fifth time this year at its meeting tomorrow. Australia's oldest bank described the economy as holding up "relatively well" on the back of strong business investment, but noted that price growth remained above the Reserve Bank's target.
"This is presenting challenges for many households and businesses, although impacts are uneven across the economy," Westpac said in its announcement to the ASX.
The bank expects interest rates to remain "elevated" into 2027 and anticipates that house prices will have fallen by 10.9 per cent from March 2026 to March 2027.
Analysis
Why This Matters
- Westpac's forecast of a nearly 11 per cent house price drop signals a major correction in the housing market, with implications for homeowners, investors and the broader economy.
- The bank's profit announcement and dividend increase come as many households face financial strain from rising interest rates, underscoring the uneven impact of monetary policy.
- The expectation that rates will remain elevated into 2027 suggests any relief for borrowers may be distant.
Background
Westpac is one of Australia's four largest banks and the oldest. It released its annual results on Monday, showing a $6.8 billion profit for the financial year to September. The Reserve Bank of Australia has been raising interest rates to curb inflation, and is expected to do so again on Tuesday, which would be the fifth rate increase this year.
What to Watch
- The outcome of the RBA's meeting on Tuesday and the size of any rate increase.
- Whether other major banks match Westpac's house price expectations or offer different forecasts.
- Signs of how households and businesses are adjusting to sustained elevated rates.
Checked
12 claims in this story checked against 1 source: 12 supported.
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- SupportedWestpac posted a $6.8 billion profit.Brisbane Times - Latest News: “Westpac has posted a $6.8 billion profit.”
- SupportedWestpac expects an 11 per cent house price fall.Brisbane Times - Latest News: “Westpac expects 11 per cent house price fall, posts $6.8 billion profit.”
- SupportedWestpac forecasts house prices will fall 10.9 per cent from March 2026 to March 2027.Brisbane Times - Latest News: “Westpac also said it expected house prices to have fallen by 10.9 per cent from March 2026 to March 2027.”
- SupportedWestpac expects interest rates to remain elevated into 2027.Brisbane Times - Latest News: “Westpac expects interest rates to remain “elevated” into 2027”
- SupportedWestpac said the economy was holding up “relatively well”.Brisbane Times - Latest News: “On Monday, the country’s oldest bank said the Australian economy was holding up “relatively well” on the back of strong business investment”
- SupportedWestpac said, “This is presenting challenges for many households and businesses, although impacts are uneven across the economy,” in an announcement to the ASX.Brisbane Times - Latest News: ““This is presenting challenges for many households and businesses, although impacts are uneven across the economy,” it said in an announcement to the ASX”
- SupportedWestpac's profit for the year to September was down 1 per cent from the previous year.Brisbane Times - Latest News: “Westpac’s $6.8 billion profit in the year to September was down 1 per cent from the previous year.”
- SupportedWestpac will pay a final dividend of 77 cents a share.Brisbane Times - Latest News: “The bank will pay a final dividend of 77 cents a share”
- SupportedWestpac's full-year dividend is $1.54, up 1 per cent from the previous year.Brisbane Times - Latest News: “taking the full-year dividend to $1.54, up 1 per cent from the previous year.”
- SupportedThe RBA is widely expected to raise rates for the fifth time this year at its Tuesday meeting.Brisbane Times - Latest News: “ahead of the next Reserve Bank interest rate decision on Tuesday where the RBA is widely tipped to raise interest rates for the fifth time this year.”
- SupportedWestpac said price growth remained above the Reserve Bank's target.Brisbane Times - Latest News: “the Australian economy was holding up “relatively well” on the back of strong business investment, but that price growth remained above the Reserve Bank’s target.”
- SupportedWestpac reported its profit on Monday, ahead of the RBA's next rate decision on Tuesday.Brisbane Times - Latest News: “On Monday, the country’s oldest bank said the Australian economy was holding up “relatively well””